With the coming of the Burlington & Missouri River Railroad in 1870, the site that became Shenandoah was transformed from the fly infested grassy bottomland on D.S. Priest’s farm into a town. The railroad selected the location, named it “Fair Oaks”, and sold the first lots. The first residents were Daniel and Phoebe O’Day, and Mrs. O’Day operated the first business, a boarding house for railroad laborers. The railroad also brought in the lumber for many of the town’s first buildings.
The first train rolled through the site on August 1, 1870, and five days later the town was officially founded. It was named Shenandoah because the landscape reminded Civil War veterans of the Shenandoah Valley in Virginia. Two lumberyards were established during the first month. Many of the first businesses, like Mettleman & Crose’s general store and S.P. Carpenter’s boarding house, relocated inventory and even buildings from the nearby Manti. New enterprises, such as the Shenandoah Reporter newspaper, also appeared within a year.
Shenandoah’s nursery industry also dates from this period. David S. Lake started his nursery in March 1870 on ten acres of land on the east edge of town. He built his nursery’s first barn around 1874. Mount Arbor Nurseries was started by T.E.B. Mason southeast of Shenandoah in 1875.
By 1871 the federal government had established a post office, and Stephen Spurlock became the first postmaster. Townspeople petitioned for the incorporation of the “Town of Shenandoah” in July 1871, and they elected their first city officers a month later. City services expanded with the construction of town wells, a “calaboose” (jail) in 1874, and a fire department in 1876.
The first school in Shenandoah’s present day boundaries was taught by J.R. Bradham in the home of Edmund Whiting in the winter of 1869-1870; however, Clestia “Lettie” Field taught the first classes within the town’s original city limits. Shenandoah’s schools were a part of the Grant Township school system until about 1873, when the Independent School District of Shenandoah formed. That year the town built its first school building, a two-story brick structure that opened in the fall with W.P. Jefferies as principal.
Church life in Shenandoah developed rapidly during the 1870s. The town’s first two churches, St. Mary’s Catholic Church and the Methodist Episcopal Church, were organized in 1871. The Methodist Episcopal Church constructed the first church building in 1873, with St. Mary’s following suit a year later.
A Masonic Lodge was started in February 1871, and an Odd Fellows Lodge formed two years later. A chapter of the Women’s Christian Temperance Union was chartered in Shenandoah in 1876, and the Shenandoah Fair Association also organized and purchased land in 1876.
By the end of the decade, Shenandoah was a booming town with a population of 1,385 and 320 students attending school. The business community had expanded to include banks, a mill and several other commercial interests. Residents had formed Company E as part of the Iowa State Militia in May 1878, and members of the company often performed as the town band. A second rail line, the Council Bluffs & St. Louis Railway arrived in 1879 the same year that Shenandoah constructed a City Hall.